Say that your original image does not suffer from wrap around effects, and thus looks as follows:
K-space modulated Image, X-Direction =
K-space modulated Image, Y-Direction =
K-space modulated Image, X & Y Directions =
Obviously K-space modulation simply equates to shifting the image along the X or Y axis, which allows for a number of imaging conventions. For instance, our raw data produces images that must be Y-space modulated in order to produce a continuous image, while image coming from another brand of MRI might require X-space modulation.
So, why does negating every other element in each row produce shifting in the X direction, and negation of every other element in each column produce shifting in the Y direction?
It is actually a very interesting feature of the Fourier Tranform - reversing the sign of the frequency at every other point in the F.T. is the same thing as multiplying the argument of the F.T. by a sinusoid at the Nyquist frequency!